Shale gas is defined as natural gas from shale formations. The shale acts as both the source and the reservoir for the natural gas. Older shale gas wells were vertical while more recent wells are primarily horizontal and need artificial stimulation, like hydraulic fracturing, to produce. Only shale formations with certain characteristics will produce gas. The most significant trend in US natural gas production is the rapid rise in production from shale formations. In large measure this is attributable to significant advances in the use of horizontal drilling and well stimulation technologies and refinement in the cost-effectiveness of these technologies. Hydraulic fracturing is the most significant of these.

With the tremendous success of the Barnett, Fayetteville and Woodford shales in the United States, the gas shale resource base will play a major role in the future natural gas production on which the nation will depend. Already the Barnett Shale gas play in Texas produces 6 percent of all natural gas produced in the Lower 48 states. Recent announcements of emerging plays in Appalachia, Northern Louisiana, British Columbia, and South Texas indicate the widespread potential of shale gas resources across North America. Each of these shale gas basins is different and each has a unique set of exploration criteria and operational challenges.